2025 Duty Performance Report of the Audit Committee of the Board of Directors of Zhejiang Huahai Pharmaceutical Co., Ltd.
Zhejiang Huahai Pharmaceutical Co., Ltd.
2025 Duty Performance Report of the Audit Committee of the Board of Directors
In accordance with relevant laws and regulations such as the "Code of Corporate Governance for Listed Companies", "Stock Listing Rules of the Shanghai Stock Exchange", "Self-Regulatory Guidelines for Listed Companies of the Shanghai Stock Exchange No. 1 - Standardized Operations" and the "Articles of Association of Zhejiang Huahai Pharmaceutical Co., Ltd." (hereinafter referred to as the "Articles of Association"), "Zhejiang Huahai Pharmaceutical Co., Ltd." Co., Ltd. (hereinafter referred to as the "Working Procedures of the Audit Committee of the Board of Directors") and other relevant provisions, the Audit Committee of the Board of Directors of Zhejiang Huahai Pharmaceutical Co., Ltd. (hereinafter referred to as the "Company") has conscientiously performed its responsibilities in accordance with the principle of diligence and responsibility. The performance report for 2025 is now as follows:
1. Basic information on members of the Audit Committee of the Board of Directors
The members of the Audit Committee of the eighth session of the Board of Directors are composed of independent director Mr. Xin Jinguo (chairman, accounting professional), independent director Mr. Wang Xuegong, independent director Mr. Li Gang, director Mr. Li Hong, and director Mr. Su Yan.
In view of the expiration of the term of the company's eighth board of directors, the company elected members of the ninth board of directors at the 2024 annual general meeting of shareholders. On the same day, the company held the first extraordinary meeting of the ninth board of directors and elected members of the audit committee of the company's ninth board of directors, namely: independent director Mr. Deng Chuan (chairman, accounting professional), independent director Mr. Wang Xuegong, independent director Mr. Li Gang, director Mr. Li Hong, and director Mr. Su Yan.
2. Convening status of the 2025 meeting of the Audit Committee of the Board of Directors
- On January 23, 2025, the company's Board of Directors Audit Committee (hereinafter referred to as the "Audit Committee") and relevant personnel of the annual audit accounting firm Tianjian Accounting Firm (Special General Partnership) (hereinafter referred to as "Tianjian") held a communication meeting on the company's 2024 annual audit work plan, annual financial status, and operating results in the company's conference room. The company's board secretary, chief financial officer, director of the audit department and other relevant personnel attended the meeting. The meeting was chaired by Mr. Xin Jinguo, director of the audit committee of the board of directors. The meeting determined the company's audit plan, time schedule and audit process for 2024. The Audit Committee pointed out: The company’s 2024 audit work arrangement is tight and detailed, and the audit work content is focused. However, the company has many branches and subsidiaries, and the audit work
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The workload is heavy, requiring Tianjian to carefully deploy and strictly implement it. The company must fully cooperate with Tianjian's annual audit work to ensure that the 2024 annual audit work is completed within the specified time with quality and quantity.
On March 19, 2025, the company held the seventh meeting of the Audit Committee of the eighth board of directors, reviewed and approved the "Proposal on Using Part of Idle Raised Funds for Cash Management", agreed that the company would use part of the temporarily idle raised funds not exceeding 430 million yuan (including the original amount) for cash management, and submitted the proposal to the company's board of directors for review.
Under the guidance and authorization of the Audit Committee, the company's audit department communicates regularly with the annual audit accounting firm Tianjian, continues to track the progress of the company's 2024 annual report audit and internal control audit-related work, and requires Tianjian to improve work efficiency and complete audit tasks with high quality and on time.
On April 17, 2025, the company’s independent directors communicated with Tianjian on the preliminary review information and related key matters of the company’s 2024 annual audit report. The company’s board secretary, chief financial officer, and audit department director all attended the meeting. At the meeting, Tianjian reported to the independent directors the focus of the company's audit work in 2024, the results of the audit work, and areas that need to be improved in future audit work. After sufficient discussion, the independent directors believe that Tianjian can follow independent, objective and fair practice standards during the audit of the company's 2024 financial report, and can complete the company's 2024 audit work with due diligence from a professional perspective.
On April 17, 2025, the company held the eighth meeting of the Audit Committee of the eighth board of directors, and reviewed and approved 21 proposals including the "Company's 2024 Annual Report and its Summary", "The Company's 2025 First Quarter Report", "The Company's 2024 Internal Control Evaluation Report", "Proposal on Re-appointing Tianjian Accounting Firm (Special General Partnership) as the Company's Audit Institution in 2025", and agreed to submit the above proposals to the company's Board of Directors for review.
On May 22, 2025, the company held the ninth meeting of the Audit Committee of the eighth board of directors, reviewed and approved the "Proposal on the Appointment of the Company's Chief Financial Officer" and submitted the proposal to the company's board of directors for review.
On May 29, 2025, the company held the first meeting of the Audit Committee of the ninth board of directors, and reviewed and approved the "Proposal on Appointment of the Head of the Company's Audit Department".
On July 18, 2025, the company held the second meeting of the Audit Committee of the Ninth Board of Directors, and reviewed and approved two proposals, including the "Proposal on the Extension of Investment Projects with Partial Raised Funds" and the "Proposal on the Completion of Raised Investment Projects and the Permanent Replenishment of Liquidity with Surplus Raised Funds", and agreed to submit the above proposals to the company's board of directors for review.
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On August 14, 2025, the company held the third meeting of the Audit Committee of the Ninth Board of Directors, and reviewed and approved three proposals including the "Full Text and Summary of the Company's 2025 Half-Year Report" and "Special Report on the Deposit and Actual Use of Raised Funds for the Company's 2025 Half-Year", and agreed to submit the above proposals to the company's board of directors for review.
On October 25, 2025, the company held the fourth meeting of the Audit Committee of the Ninth Board of Directors, and reviewed and approved the "Company's 2025 Third Quarter Report". The Audit Committee believed that the company's 2025 Third Quarter Report truly, accurately and completely reflected the company's financial status and operating conditions, and agreed to submit the above proposal to the company's board of directors for review.
3. Performance of relevant work of the Audit Committee of the Board of Directors
- Supervision and guidance of the company’s internal audit work
During the reporting period, the Audit Committee carefully reviewed the internal audit plan for this year submitted by the subordinate audit department and recognized the executability of the plan. At the same time, it actively urged the internal audit institution to carry out its work strictly in accordance with the audit plan. The Audit Committee proposed that in view of the large number of subsidiaries and the wide distribution area of the company, it is necessary to strengthen the internal audit supervision of the company and its subsidiaries in terms of financial reporting, capital activities, procurement management, engineering projects, asset management, etc., and evaluate the implementation of internal controls. At the same time, the Audit Committee put forward guiding suggestions on internal audit work, requiring the Audit Department to further improve the effectiveness of internal audit work, strengthen group audit work, effectively curb various possible frauds, and promote the healthy and sustainable development of the company.
- Review and supervision of the company’s financial information disclosure
During the reporting period, the Audit Committee carefully reviewed the company's financial reports at all stages and fully communicated with Tianjian before the annual audit agency entered the scene; confirmed the company's annual audit plan and related work arrangements; reviewed the financial accounting statements prepared by the company and made targeted rational suggestions for subsequent audit work; reviewed and expressed opinions on the audit report and the company's financial report issued by Tianjian; summarized Tianjian's performance and work results in the annual audit work, and made recommendations on the renewal of the annual audit accounting firm accordingly.
- Supervision and evaluation guidance on the construction of the company’s internal control system
During the reporting period, the Audit Committee gave full play to its role as a professional committee, followed the requirements of the enterprise's internal control standard system, actively promoted the construction of the company's internal control system, and organized and ensured the company's corporate governance in a planned and step-by-step manner.
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To ensure the smooth implementation of the company's internal control evaluation work, strengthen and improve the company's internal control evaluation management, and supervise and guide the company's audit department to complete the internal control self-evaluation work.
- Explanation on the performance of the company’s re-appointment of the accounting firm
The Audit Committee fully understood Tianjian’s practice and reviewed and evaluated the audit work of its 2024 annual report. It believed that Tianjian followed independent, objective and fair practice standards in the audit of the company’s annual report, had strong professional capabilities, and successfully completed the audit of the company’s 2024 annual report. Therefore, the eighth meeting of the Audit Committee of the eighth board of directors of the company reviewed and approved the "Proposal on Re-appointing Tianjian Accounting Firm (Special General Partnership) as the Company's Audit Institution for 2025" and proposed to the Board of Directors to re-appoint Tianjian as the company's audit institution for 2025.
4. Overall evaluation of the performance of duties of the Audit Committee of the Board of Directors in 2025
During the reporting period, the Audit Committee performed its duties conscientiously and responsibly in accordance with relevant laws and regulations, the Articles of Association, the Working Procedures of the Audit Committee of the Board of Directors and other relevant provisions. In 2026, the Audit Committee will continue to use its expertise to pay close attention to key matters such as the company's regular reports, financial audits, and internal controls, effectively leverage the professionalism of the Audit Committee of the Board of Directors, and effectively safeguard the interests of the company and shareholders.
Audit Committee of the Board of Directors of Zhejiang Huahai Pharmaceutical Co., Ltd. April 29, 2026
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